Supplier law: Companies face new challenges!

Since the beginning of 2024, the supply chain law has also been valid for companies with 1,000 to 3,000 employees. An example of this is Biotest, a company from Dreieich with around 2,500 employees. Biotest started preparing for the requirements of the law in 2022 and estimates that implementation will be associated with costs in the middle six -digit range.

In order to meet the provisions of the Lief chain law, an employee was hired as a human rights officer. Biotest has also developed special questionnaires to obtain information about the working conditions of its suppliers. The company is working on methods for handling possible human rights violations in the supply chain. Julia Hentschel, professor of supply chains, expressed concerns about the high bureaucratic effort that goes hand in hand with the law. It suggests maintaining the fines of human rights violations, but to abolish the documentation obligation.

control and challenges

Compliance with the supply chain law is monitored by the Federal Office for Economics and Export Control (BAFA). Since the new regulation, 5,200 companies have been committed to reporting and documentation nationwide. Due to the need to implement a European supply chain law into national law, controls by the BAFA are exposed to the beginning of 2026. Dirk Neumüller from Biotest emphasizes that these changes are not relieved for the company, since it must continue to remain.

The supply chain law also has an impact on smaller companies such as the chemical dealer A+E Fischer, which employs 80 employees. A+E Fischer is forced to hire additional employees to meet the requirements of the larger companies that supply them. The aim of the law is to improve the human rights situation in the supply chains. Hentschel notes that a careful testing of the supply chain can also lead to improvements in ecological and social standards.

In addition, the supply chain law requires the appointment of a human rights officer to monitor risk management. The tasks of the human rights officer include regular risk analyzes, the implementation of prevention and remedial measures as well as the establishment of a complaint procedure for affected people within the supply chain. The human rights officer is responsible for surveillance, but not for the implementation of the measures. The documentation obligations and the creation of an annual report can be part of his tasks, such as Weka reported.

It is recommended to set up a staff position for the human rights officer who takes over the coordination and monitoring of the tasks. Responsibility for the implementation of the supply chain law is often located directly in the management or in the compliance area. However, the human rights officer does not have a special protection against dismissal, which can lead to conflicts if he wants to criticize corporate practices.

Companies expect more clarity about the controls and possible changes to the law after the Bundestag election in February 2025, as Tagesschau